Hong Kong stocks start 2022 with losses on mainland property woes

Hong Kong stocks slipped on Monday, their first trading day of 2022 after marking the worst performance by any major global market the previous year, as fresh fears about the health of China's property market weighed on investor sentiment.

The Hang Seng index closed down 122.92 points, or 0.53 percent, at 23,274.75. The Hang Seng China Enterprises index fell 0.58 percent to 8,188.76.

The Hong Kong benchmark lost 14.1 percent last year, its worst yearly performance since 2011 and the worst performing major global market in 2021, hit by declines in Chinese tech giants as well as fears about the health of China's property sector.

Mainland Chinese markets were closed for a holiday, and Hong Kong trading volumes were thin. About 734.33 million Hang Seng index shares were traded, roughly 45.6 percent of the market's 30-day moving average.

"The weak trend of Hong Kong stock market on the first trading day of 2022 is related to the continued unfavourable news in the mainland property industry," said Kenny Ng, a securities strategist at Everbright Sun Hung Kai Securities.

China Evergrande Group shares were suspended from trading on Monday pending the release of "inside information", the embattled property developer said without elaborating.

A city government in the Chinese resort island of Hainan has ordered Evergrande to demolish its 39 residential buildings within 10 days, due to illegal construction, local media reported over the weekend.

A sub-index tracking mainland property stocks closed down 2.81 percent, having earlier fallen over 4 percent to test a four-and-a-half-year low.

Tech giants lost 0.54 percent.

The sub-index of the Hang Seng tracking energy shares rose 1.4 percent, while the IT sector dipped 0.97 percent, the financial sector ended 0.23 percent higher and the property sector dipped 1.06 percent.

Artificial intelligence company SenseTime closed more than 40 percent higher at HK$7.75, after its share were priced at HK$3.85 in an initial public offering late last month.

(Reuters)